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11 Apr, 2014 15:29

‘Giving out pies in Maidan not enough’: Putin urges West to really help Ukraine

‘Giving out pies in Maidan not enough’: Putin urges West to really help Ukraine

Europe should switch from promises to real action to help Ukraine out of the economic chaos, says Russia’s President Putin.

“What’s the problem for the near future? It’s that Russia can’t bear the brunt [of helping Ukraine] in a one-way fashion,” Vladimir Putin told the Security Council meeting on Friday.

That was the main reason President Putin decided to send a letter to his European counterparts on Thursday, in which he urged them to hold an immediate meeting to decide on a game plan to help the Ukrainian economy out of the crisis.

If somebody treats Ukraine kindly, he should make a real contribution to help avoid a default, Putin said.

“Giving out pies in Maidan is not enough to support the Ukrainian economy and prevent chaos there,” he added.

The address to Russia’s Security Council largely echoed his Thursday letter, where he also stressed that Russia has so far been the only country to provide real help to the Ukrainian economy.

Both the US and the EU have promised to provide financial assistance, which Putin says remains rhetoric.

Talking about the US decision to give Ukraine $1 billion in loan guarantees, Putin explained that such guarantees are not real money or a loan, just guarantees “for the banks that would be ready to finance [Ukraine], but there are no such banks, which means there’s no aid.”

"We are seriously concerned about this," he added.

Meanwhile, Ukraine’s total debt to Russia now stands at $16.6 billion, including the $2.2 billion bill for gas.

The situation with Ukraine not paying for gas consumption is "completely intolerable", Putin stressed.

"The dramatic situation includes the fact that in the first quarter of this year [Ukraine] had the lowest gas prices, and even at those prices our Ukrainian partners stopped paying,” he said as April 7 was another due date for payment according to the current gas contract.

“Out of the $540 million owed, not a single dollar or ruble was paid. Absolutely nothing, zero," Putin said.

In his letter to major Russia’s gas consumers, which include Germany, France and Italy, Putin said that in the near future the Ukraine situation could threaten gas transit to Europe.

Despite that, Russia will fully honor its obligations to supply natural gas to European partners, the President said.

"Russia is acting very neatly, very considerately and respectfully towards our partners. We will certainly guarantee in full the honoring of all our obligations to our European consumers. We are not the problem, the problem is ensuring transit via Ukraine," he said.

Russia’s largest gas producer Gazprom has ended all discounts and now charges $485 per 1,000 cubic meters of gas. This is a price Ukraine says it will not be able to pay because it threatens Ukraine's ability to continue normal gas transit operations to Europe.

In the past four years, with all the discounts provided by Russia, Moscow claims to have subsidized Ukraine’s economy to the tune of $35.4 billion, coupled with a $3 billion loan tranche in December last year.